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Went through a recruiter and they got me interviews for full time and contract software engineering positions. Full time one went real well but they are really high on my accepting the on the contract. What is their incentive structure like for candidates accepting contracts versus full time jobs?

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For the full time job case, there is a percentage of your annual salary that the client would pay the recruiting firm for a permanent hire. For example, if the job paid $60,000/year the client may pay 30% of that salary or $18,000 for the hire. Note that there may be passing a probationary period here so that it isn't just an automatic payment when you start on day one.

For a contracting case, there is a percentage of the rate that the company would take. In this case, you may be paid $30/hour but the client is paying more than that and the recruitment firm is pocketing the difference mostly. For this scenario, the longer the contract is there the more money they make and thus this is usually what some firms may prefer to do.

At least this is my understanding in North America for how this works.

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    plus, if you're amazing, you might stay at that fulltime job for years and years, but the contract will end and you'll get another and another and another. Always money for the recruiter in that lifestyle. – Kate Gregory Dec 9 '15 at 23:06
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    this is my understanding as well, you're a better source of income to them as a contract – Kilisi Dec 10 '15 at 0:47
  • Look at it this way. The only way for the recruiter to earn more money in a full-time situation is if you lost your job, but if you lost your job quickly, you most likely won't work with that recruiter again, so he can't win. With contract, he just gets more money over time and the happier you are, the more money for him. He may also get a cut if you transition from contract to full time, but that's negotiated between the recruiter and the company, and you really don't have normal access to that information. – Nelson Dec 11 '15 at 1:10

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